SENSEX, NIFTY50 edge lower after crude oil spikes as tensions in Middle East escalate

The Indian equity benchmarks edged lower on Tuesday, May 5, after crude oil prices advanced as tensions in Middle East escalated. The SENSEX fell as much as 524 points and NIFTY50 index touched an intraday low of 23,949 dragged down by losses in index heavyweights like ICICI Bank, HDFC Bank, Larsen & Toubro, Bajaj Finance, Maruti Suzuki and Axis Bank.

As of 9:24 am, the SENSEX traded 267 points lower at 77,002 and NIFTY50 index declined 89 points to 24,030.

Crude oil spurts

Crude oil jumped above $114 per barrel as investors remained cautious and gauge the impact of the fresh attacks in the key maritime trading route, the Strait of Hormuz.

Latest reports suggest that the ceasefire deal between the United States and Iran remains fragile, as fresh attacks over the last 24 hours have added additional strain between the two countries at war in West Asia.

The global benchmark Brent crude oil prices (July futures) surged to over $114 per bbl in the early hours on Tuesday.

Wall Street ends lower

US stocks ended lower on Monday following a spike in crude oil. Dow Jones Industrial Average dropped 1.13%, S&P 500 index declined 0.41% and tech heavy Nasdaq fell 0.2%.

Sector watch

Selling pressure was broad-based as 12 of 15 major sector gauges compiled by the National Stock Exchange (NSE) were trading lower led by the NIFTY Financial Services index's 0.6% fall. NIFTY Bank, Auto, Metal, Pharma, Private Bank, Realty, PSU Bank and Healthcare indices also declined between 0.2% and 0.6%.

On the flip side, select IT, media and FMCG shares were witnessing buying interest.

Broader markets were outperforming their larger peers as NIFTY Midcap 100 index advanced 0.07% and NIFTY Smallcap 100 index rose 0.35%.

Among the individual shares, Tata Technologies surged nearly 10% to hit an intraday high of ₹647.95 after it reported an 8% increase in consolidated net profit to ₹204.17 crore during the March quarter.

The company had posted a consolidated net profit of ₹188.87 crore in the corresponding quarter of the previous fiscal year.

NIFTY50 top gainers and losers

Bajaj Finance was top loser in the NIFTY50 index, the stock declined 1.4% to ₹936. Shriram Finance, Larsen & Toubro, Bajaj Finserv, ICICI Bank, HDFC Bank, Coal India, Hindalco, Sun Pharma, Tata Steel and JSW Steel also fell between 0.9% and 1.4%.

On the other hand, Adani Enterprises, HDFC Life, Bharti Airtel, Bharat Electronics and Titan were top gainer in the NIFTY50 index.

The overall market breadth was neutral as 1,393 shares were advancing while 1,389 were declining on the NSE.